In a new opinion piece published on ifa, CEO and senior adviser at Lifestyle Financial Services Gareth Hall said that the issues paper is missing “the one thing that has the biggest potential to improve advice affordability and accessibility”.
“The government’s Quality of Advice Review is seeking to rectify this by examining how the regulatory framework can better enable the delivery of high-quality, accessible and affordable advice,” Mr Hall wrote.
“However, the initiative that has the greatest potential to move the dial in terms of getting quality advice to the masses is notably absent from Treasury’s Issues Paper.
“There is no mention of workplace financial advice.”
Mr Hall said Australia’s corporate superannuation sector has been “decimated” due to changes to adviser remuneration and cross-subsidisation, with only a small number of planners left who specialise in workplace advice despite demand from employers and employees.
He added that any changes to regulatory framework should seek to reduce the compliance burden on advice businesses.
“At a fundamental level, there must be greater clarity around what constitutes general advice (or information) and personal advice,” Mr Hall wrote.
“Amending the Corporations Act 2001 to resemble the Financial Services Council’s proposed definition of personal advice as only advice that considers the ‘personal circumstances of the individual’ would encourage employers and industry funds to develop and deliver more valuable advice.
“Regulatory change that increases the ability of funds to provide general advice should balance the government’s objective to reduce the extent to which the retirement savings of members is eroded by the cost of providing financial advice with its goal to improve advice accessibility and affordability.”
Read the full opinion piece here.
In a recent webinar, AFA CEO Phil Anderson said the review, to be released in December, has an opportunity to key issues in the advice industry, including declining adviser numbers.
“We need to make sure that we have a focus on retaining as many of the existing advisers who are considering their future,” Mr Anderson said.
“But we also need to make sure that we have a steady flow of new advisers coming in to the advice profession so that we can start to rebuild adviser numbers.”
Individual licensing for advisers is the path forward. It would force dealer groups to either actually deliver a service and be accountable for the ridiculous fees charged or they will fold.. individual licensing would allow advisers to run their businesses they way the business owners want rather than towing the line and running a model tied to the dealer groups agenda and business model which reflects nothing of what is in a clients best interest and only what is in the interest of fat cats running the dealer groups.. Every dealer group claims to be different but they are all the same.. they are unwanted and unnecessary and simply an excessive cost to business and clients..
Agree with this. The government could even release a set of industry templates to use in everyday advice and compliance. At the moment there are too many compliance boffins all trying to justify their roles and protect licensees with their own take on ‘what’s needed’.
Is it really a surprise that government’s proposed solutions to the biggest issues faced by consumers doesn’t actually take into account real world solutions or consumers? If ASIC ever asked consumers what they need/want, how they need/want it and how they’d like to pay for it we would be sitting in a completely different industry. One where things work. One where consumers have the protections they need BUT also receive what they want, what they pay for and in the ways they both want and need it. The solution to the issues in our industry? Sadly it would involve removing public servants from regulating and governing the industry they have no experience nor real knowledge or understanding of.